Last session of the day. First of all, if I don’t get a chance to thank you all personally -- I do want to thank you for coming to the conference. We do appreciate your support. We appreciate your business. I know that you don’t always hear that from the sell side, but you guys have been good to us in the past and we thank you for your continued commission payments. They pay for these conferences. We have to earn a return on them obviously or they get cut out of the budget pretty quickly and the last 10 years has been a budget cutting world. So, the fact that we have been able to maintain this conference and actually increase the budget every year is a testament to the support we are getting from our institutional clients. So thank you all for that. We look forward to seeing you next year as well.

I think our attendance has been up almost 10% each of the last three years. So we’re going to run into some capacity problem soon. Already they were kicking people out of the hotel, couple of nights ago. So anyways it’s a high-class problem. We also have about 15 companies on the wait list who want to be at this conference, so that’s also a high-class problem. So the fact that you all have been so heavily involved, has created some vibe among the clupeids who also want to participate in the conference.

So that we have our last session of the day is GE, and Jeff Bornstein who is the relatively new CFO, hasn’t done a whole lot of conferences yet. Maybe this might even be your first or second. But we do appreciate you being here. I think many of you have had a chance in the last couple of days to meet Matt Cribbins he is the new Investor Relations guy at GE replacing Trevor. Trevor was around for a long time. He was bit of an iconic figure when it comes to Investor Relations guys, this poor guy was put through the ringer of the financial crisis and somehow flipped through it, hopefully got a little battle pay for that, so that was or if it is anything like me he probably get a pay cut which is what we got.

So anyways good luck with that; Matt it’s going to be -- I am sure it’s going to be a lot of fun to get to know these guys there. I don’t want to say anything bad. No, anyways, so look we're not really time constrained which is why I'm joking around a little bit on stage, but we do right after this have our analyst round table for those of you who came last night, it’s an efficient way for you to capture some feedback from the day from the other analysts in the other sessions, and have an open Q&A, so that’s going to be pretty much right after this in the same room as last night.

So Jeff I think I want to keep this relatively open but maybe a great way to start since you are reasonably new in the role. Let’s talk about what your mandate is and what you think you can -- what your boss and what the Board wants from you and the role and how it might be evolving and maybe some of your early observations from the role too on positive surprises and negative surprises?

Jeff Bornstein

First of all, congratulations on the conference, the attendance is pretty impressive now I think if you actually pulled this off in Lake Placid New York I'd be really impressed, but not withstanding that it’s -- you got a good turnout here which is great. I am very focused operationally in the Company on simplification, cash flow and ultimately margins. And that is how I'm spending the bulk of my time. In addition to that capital allocation obviously is a big issue in making sure we are putting that capital, deploying that capital in an investor friendly way is critically important.

And that is how I’m spending the bulk of my time. Unfortunate to the moment anyway that you know Keith had to deal with a lot of crisis, one thing after another. And right now I think we're in a pretty stable place, and so I'm principally focused on us delivering operationally on the commitments that we've made.

Scott Davis - Barclays Capital

Let’s talk about cost side opportunity we will start with the fun stuff because this is such a critical component of whether GE stock is a winner or a loser over the next couple of years in our opinion at least -- and you had a bit of a sell off after the quarter and we can talk about that next. But gives us a sense of your confidence and ability to take out structural cost and where some of the low hanging fruit is and at what point does maybe some examples, some tangible examples so that at least the audience can understand because one of the feedback -- pieces of feedback I get from investors when I'm out on the road talking about GE is that, hey you know -- their comment would be I thought GE was a well oiled machine, how could there be cost to take out in a Company that’s been so well run for the last 20 years. And that’s the piece of feedback we get. But then clearly the cost out in the last 12 months was very good and your goals for the next 12 are fairly admirable as well. So maybe you can address that.

Jeff Bornstein

Yes, so I'd start with simplification is really about competitiveness. I think we live in a world today where the pace of change is just phenomenal, globalization exacerbates that. And I think long-term you can’t win just on technology, you got to win on technology and cost and the cost position, simplification for us is a way of getting -- reducing the friction, increasing the speed of the Company and I think fundamentally what it means is how do you get $150 billion Company to run with a sense of urgency and customer focus that a much smaller company would operate at. And a byproduct of that is we have the opportunity to change the cost structure of the Company, which I think competitively is paramount. And an outcropping of that is the margin improvement, so it all more or less fits together. Now I get the question a lot about I thought GE was a well run Company how can you have all this opportunity?

I think GE historically has been a well run Company, that certainly doesn’t mean in any way, shape or form that we’ve enjoyed all the benefits that we are capable of enjoying in terms of scale. And it’s much more than an SG&A discussion, we tend to focus on that a bit because it’s an easy external cost, people can compare our performance with other companies. For us simplification is about the entire cost structure of the Company. It’s direct material, it’s manufacturing footprint, it’s supply opportunity, and it is SG&A, it’s engineering cost. So there’s no part of our cost structure that we’re not thinking about and not focused on.

Speed, cost, technology is the output that we need to deliver on if we’re going to deliver the impacts that we’ve committed to investors over the next two or three years, and how we have described success in 2016. So I’ll give you a few examples, shared services, so everyone of your companies have this same thing, you have all these processes in your backroom whether you recognize or not that are not between you and what you might be learning from, a company that you’re evaluating for investment or actually making the investment or monitoring your portfolio. But behind the scenes you’ve got people that are running your healthcare, making payroll, doing accounts payable, writing the applications that support whatever systems you’re using.

We have an enormous opportunity to leverage that across the company and when I talk about shared service, that’s what I’m talking about. World class companies basically run that backroom, 60%-65%-70% shared, today at GE we’re about 35% and we’re like in the first inning. So there was an enormous amount of scale that we can garner by consolidating those processes and activities across the world. Doing two-three-four times in hubs versus doing them 100s of times in individual P&Ls, across 160 different countries.

On the supply chain side if you take our industrial systems business within energy management, now we started there on a simplification in about a year and a half ago. It’s an old GE business with a big supply chain manufacturing footprint. Now we reduced the factory footprint, supply chain footprint in that business 30% in the last 18 months. And that business has gone in 2013, that business grew earnings 30%, this is an old state GE business where 2% or 3% top-line.

So we see it over and over again, reducing complexity around structure, faster decision making more authority at the point where the action is actually taking place, reducing the overall cost structure and competitive as a Company we end up with better businesses. The last example I’ll give you is services, one big asset that we have is, we have this enormous services backlog, where for the most part we have sold this service into the future at a price and in many cases we’ve escalation clauses on top of that, based on indices, so, every single dollar cost we find a delivery against that service is a dollar margin, sometimes if that includes investment less the cost of, to get that dollar cost down.

We are hugely focused on that, that is an enormous opportunity for us to deliver more margin and more value overtime, and so simplification we tend to talk about SG&A, it is much more pervasive than that, it’s a different way to think about running the Company, it’s a different behavioral set for the leadership team and the folks in the businesses do. You know we’re early innings but I think we feel pretty good with the momentum that we have.

Scott Davis - Barclays Capital

That’s helpful, let’s, and I want to go to ARS question too because I may forget, and I think this is my 15th session here in two days and those bright lights are brutal aren’t they?

Jeff Bornstein

Yes, that’s why I’m looking at you.

Scott Davis - Barclays Capital

Yes it’s, I am wondering when the headache’s going to go away but, let’s talk about earnings quality and one of the things that, when I first started covering GE a dozen years ago, GE always made its numbers, it was fairly opaque and there was real estate gains and private equity gains and there was always a lot of moving parts but people are relatively forgiving because the underlying businesses were measurable and generally good.

Over the years I think what we’ve seen is almost a, I’m not sure this is statistically true but at least the perception is, is that the volatility and the standard deviation around earnings quality and the results has widened. You have a couple of quarters that are really that are tangibly measurably good and then a quarter like this most recent quarter where it’s a little bit of a head scratcher and people say I don’t understand how 20% of the earnings could come from tax and things like that.

That may or may not be fair, but it’s those perception issues find a way into your multiple, right. So how do you particularly as the new CFO address that variability and those issues within legal limits, obviously, but how do you address that and make investors comfortable that what they see is -- what they get out of buying GE is a fairly to the high executing predictable high quality earning stream company?

Jeff Bornstein

I almost, I think there is two questions. The first one, transparency, I think in the fourth quarter we try to be very transparent. I mean we -- I told folks that we were going to have some gains in the quarter from industrial sales and that we would book those in corporate. We did that. We laid out the impact of that. They weren’t buried down in the segments. GE Capital had a very messy quarter between the Swiss IPO and impairments et cetera. And we try to walk through the bigger pieces of that and explained to people how that was. And that the tax benefit you’re referring was largely driven by this the Swiss IPO and what the source of it was. And then I try to give you a sense of from an ongoing perspective how you might really think about what the continuing performance of GE Capital ex all that noise was in the quarter.

So, I think we’re trying to be transparent with people on how we go from A to B on the margin point, right. I didn’t say 70 hard round, right. We said we ended at 66 and 66 is not 70 and it’s how the 66 came together. We have tried to be clear with folks on the call about how we thought about the relative performance of individual businesses. When we have head businesses, and we don’t think it performed up to snuff I think we’ve said and we have tried to describe why we think that is and whether we think it’s a lingering issue or something we got our arms around. So, I can really only talk about two or three quarters here the ones that I have really participated in this level and we try to increase with transparency. We are issuing the -- we’re giving you guys a picture with the press release as opposed to waiting to see it on the call and we will be doing other changes and enhancements going forward to kind of help the investment community understand where we are.

The second part of your question on how do you make the Company more predicable per se. I mean I think, we have operating rhythms in the Company obviously that we performed it that we try to stay to ahead of what’s going on in the businesses and that we feel good about in the short-term that we understand what performance is going look like. It’s easier over the longer term or multiple quarters to understand exactly where we are. You do have things that happened in an individual quarter and I think our responsibility is when those things have to be transparent with investors about what those are and why they are what they are and our responsibility to make sure that we set our plans with the businesses and we have communicated with investors around expectations what’s going to happen. That is reasonably within a role of apples of what we expect.

Scott Davis - Barclays Capital

What about some of the noise around discontinued ops below the line items that we finished off 2013 and maybe some sense of guidance around 2014 and how you think about that going forward?

Jeff Bornstein

Yes, so the discontinued operations are associated with particularly dispositions at GE Capital. Those are going to happen all the time as we continue to pair that portfolio down. We try to be pretty transparent with people on what those impacts are. I think we’ve detailed them out when they have occurred. The really the two big items are the WMC and Grey Zone have been the bigger items in discontinued ops, as most of you know, we’ve got this opportunity in the first quarter as part of the contract with Shinsei to evaluate a buyout of liability with Shinsei.

We are actively with Shinsei on that now. And when we have got something to share with folks, we will in fact do that. And then WMC, we’re continuing to make progress. And I am hopeful that overtime this will resolve itself within the financial construct that we’ve communicated to people and this won’t be lingering. So I understand pressure point on those two items and we would like to get those off the table if we can.

Scott Davis - Barclays Capital

Okay let’s go to the audience response system and then I want to open up questions to the audience as well. But let’s make sure we work our way through these and get a sense of the audience and ownership profile here, do you currently own the stock? Let’s vote please. And I will give you a little color on this when we see the results versus other companies.

Okay, 61%, no, the average has been 75%. So, you’re the lowest we’ve had. So that’s probably market cap related. Only 9% underweight I think that’s better than I would have expected. Okay let’s go the next question. What is you general bias towards the stock right now? A positive, negative, or neutral, let’s vote on that.

There may be a selection bias of people who have stayed at the conference. Okay 33% negative is on the higher side of what we’ve seen, so clearly you have some skeptics out there. And let’s take question three. In your opinion through cycle EPS growth for GE will be above peers, in line with peers or below peers? And to be clear that’s the multi-industry peer group, the industrial companies that are here at this conference for the last 2 days, 50 or so companies, let’s vote on this.

Okay below 70% below peers that’s substantially higher than what we’ve seen. So again there is a -- that's consistent with the level of skepticism that I’ve seen out there on the road for sure. Alright, let’s open up the questions to the audience then.

Question-and-Answer Session

Mike, you want to take one? Either people are intimidated by you or they are afraid the glare off my head is too much to take.

Unidentified Analyst

So from the CFO’s seat, as you go through the spin of U.S. Retail Finance, I guess just two questions. One, continuing on from the Investor Days from December, what are the plans with the rest of Retail Finance, particularly the international businesses. And then, two, as those are worked down, what are the plans with what you can do with the industrial balance sheet?

Jeff Bornstein

Okay, so I think we’ve shared with everybody what our outlook and plans are with the retail business. I don’t have anything new they were on-track with what we shared with investors back in the fall.

Scott Davis - Barclays Capital

When did you say you filed in April?

Jeff Bornstein

We said we plan to file in the first quarter.

Scott Davis - Barclays Capital

First quarter, okay.

Jeff Bornstein

Yes. So no process change there I think we’re largely on-track with what we communicated previously. For the balance of the retail business or consumer businesses in GE Capital we’ll opportunistic overtime. I mean I think we’ve been clear that longer term that we’re going to be largely focused on our commercial lending franchises. And so when it makes sense and where we think valuations are right and execution is there, overtime, we will paradigm the balance of the consumer portfolio.

Most of that today is in Europe and if things in Europe in the financial sector continue to improve we will take advantage of that. So that will take a period of time but we’ll execute that. On the industrial balance sheet we believe we have an opportunity here to add a little bit of leverage I think the timing looks right, rates have backed up I think there is -- you can get duration that matters here and I think you can do it and credit spreads are quite tight and we are a name on the industrial side that doesn’t issue often or in quantity.

So I think there is opportunity here to do something and to do it at very attractive rates with long durations but on an after tax basis look really attractive vis-à-vis our dividend yield. So we’re looking at it quite seriously. Now size wise I’m not talking about 10s of billions of dollars here I’m talking about reasonably modest amounts here. But I think it makes all the sense in the world in that.

Overtime, we’ll see how where we end up -- where we finally settle out on GE Capital from an investment perspective. That combination with how pension deficits resolve themselves therefore everybody is improving, et cetera, et cetera, may change our outlook in the future on how much more leverage we want to put on or not and based on where markets are and what other capital allocation opportunity is, we’ll think about it we’ll just have to see how that plays out overtime.

Scott Davis - Barclays Capital

Next question? There is one in way back here. Go ahead.

Unidentified Analyst

Hi. Quick question, I think it’s probably hard for us to appreciate from the outside how complicated GE is internally as an organization. But can you talk about the process of change? One of the things I think it’s hard to understand from the outside is when we talk about things like the retail exit or leveraging the industrial balance sheet or potentially exiting Appliances & Lighting or spinning that off things that could be meaningful changes it is not clear why it takes quite so long?

Jeff Bornstein

Well I’m not sure all those decisions take that long. I mean you led with retail, right. The discussion on retail was from the point we felt like the market conditions made sense and I don’t just mean the equity markets I also mean the lending markets. We made that decision quite quickly. The actual process of putting that together and creating a standalone Company and getting an S1 together is an extraordinarily detailed and involved process.

So as it relates to the leverage I think I’ve been very clear I’ve talked about this last fall and suggested that at the turn of the year here we take a look at that and I don’t think we have spent an extraordinary amount of time on it. We went through in our capital allocation process and evaluated all our options and we did that towards the end of the year here. And when we think the conditions are right and it’s time execute we’ll in fact do that I don’t think it took a long time to make a decision one way or the other on that.

So, it is a big company, obviously it’s quite a big company. We run it with operating processes that I think hope they can feel and actually operate them like a much smaller company and that’s part of what simplification is about is getting the friction and bureaucracy out of the system, getting the decision making pushed out where the action is, and where the authorities are eliminating layers upon layers of approval, getting rid of all that stuff. It just slows us down, it doesn’t inform the quality of the decision one bit in the process.

So, I think we do have work to do there but I think we got a set of operating processes that for the most part, I don’t want to give you any impression that this is an unwieldy bureaucratic thing. It could be much sleeker, much faster, much more customer centric and operate at customer speed than it does today and that’s what we are focused on for simplification.

Scott Davis - Barclays Capital

Good question, next question. Let’s do the next ARS question because I am going to make sure we get through these from the floor. What should GE do with excess cash, bolt-on M&A, larger M&A, share repurchases, dividends, pay down debt or internal investment? But I think this is a fairly topical question so let’s vote.

Okay, 48% share repurchase that’s a big number. Alright, let’s go on to question five then. In your opinion in what multiple 2014 earnings should GE trade? That’s PE but let’s vote on that. Okay, that’s a little better than the last year, a little bit lower than peers. Let’s do question six, what do you as the most significant investment issue, core gross margins, capital fund or execution? Vote.

Okay, that’s an unusual one, that’s far different than what we have seen with other companies execution strategy almost never get voted on. So, that’s interesting, I would have thought margins would be a little higher.

Jeff Bornstein

I would have expected the margins to be a little higher too.

Scott Davis - Barclays Capital

Okay. Let’s talk about, I don’t want to climb in to new sheet here but let’s talk about power turbines in the gas business, overall this is such an important business for you guys and it is the one business that whether it’s just coincidental or not, it’s one business that correlates fairly highly with your stock. So, it’s important for us to follow. I don’t think a day goes by or at least in the last two months that I have not gotten a message from one of my colleagues in Europe talking about how bad pricing is in gas turbines and the Japanese being a little extra aggressive and communicating, all this gets communicated through Siemens I am sure but your order book in 4Q was very strong, surprisingly strong. I think it was something like 65 gas turbines that’s a big number. Your entire order book for the last year was like 130?

Jeff Bornstein

124, 125.

Scott Davis - Barclays Capital

Yes, so I mean that’s a big, big, big number. Can you give us some color around A; why you are winning and to completely clear to the audience in the same emails I get people comment that GE is losing share, it is not losing share. There is absolutely no, we get the data on market share and actually it's gone the other direction. GE has actually gained share, would you agree with that?

Jeff Bornstein

Yes, I think we gained close to 5 points a share.

Scott Davis - Barclays Capital

Yes which was a surprise to us but people like to pick on GE, so it’s, they find every data-point and fixate on it that’s negative. And actually to be 100% clear the data that the competitors I am talking about is actually inaccurate. They have gained share but 60 is a big number, I mean how are you winning and if I wanted to play devil’s advocate, is there a risk that you are winning but at an uneconomic level that you are just giving away too much price. And that on order book of 40 at a better price, it’s better than an order book of 60 was at that price?

Jeff Bornstein

So, I agree with you, fourth quarter was actually quite strong. As you said we took orders on 65 turbines, that’s a total we are up to, a number that was slightly better than what we expected internally or what we had communicated externally. We also talked about in the fourth quarter that our quoting volume was up substantially in the fourth quarter versus where it have been, almost twice as high as it’s been in some period of time. And the some of that activity was actually in U.S. which is up so many percent, I am not suggesting to for a moment that we have got a major turn here going on in terms of gas turbine and investment in the U.S. but definitely stronger in the U.S.

There is no question that the gas turbine market is going to be incredibly competitive over the short and medium term. So eyes wide open I think the price is going to be a pressure point on gas turbines, which makes simplification everything else we’re doing on cost, all that much more important, so we are getting at the cost and having the world’s lowest cost position is absolutely critical. But as you said we actually gained about five points a share last year, so we’re not losing share, we’re actually gaining share.

As most of you know notwithstanding the pressure on price in a competitive dynamics, the services business, the installed base is absolutely critical because the service business is incredibly profitable for us, the service agreement, the spare parts consumption, et cetera et cetera. And so over the long-term it is absolutely important that we maintain our share of installed base because that is the service annuity, ultimately down the road for us.

So it’s a big deal, we like where we’re going technologically, particularly in larger turbines, more to come on that later. So I think we feel pretty good about where we’re. We -- our thermal business ex so just on the equipment side we expect to be profitable in 2014. So we’re not pricing these or shipping these turbines in ’14 in a place where we’re actually going to lose money on shipments. We expect to earn money, shipping gas turbines in 2014.

Scott Davis - Barclays Capital

Is it part of that fixed cost coverage is it?

Jeff Bornstein

Well some of it is fixed cost performance no question about it.

Scott Davis - Barclays Capital

Okay.

Jeff Bornstein

Some of it is variable cost performance. So I think we feel pretty good about where we are competitively on gas turbines.

Scott Davis - Barclays Capital

I think, and again after two days of this, my memory starts getting a little foggy but I think Jeff mentioned something like 10% cost out in gas turbines.

Jeff Bornstein

They get 10% SG&A out in our Power Gen business and they will have another big year on cost on restructuring so potential performance again in ’14, all the businesses worldwide, but they in particular will as well.

Scott Davis - Barclays Capital

I don't want to hog questions, so if anybody has a question, please just raise their hand. Is there a question back there? I can't tell. I can't see a darn thing with these lights. But let's talk about medical and maybe we can go around the world and talk a little bit about each of the businesses. Medical is one of those where when people ask me what is the net effect of Obamacare on the North America diagnostic equipment market, I have an answer but I am not sure it is a great answer, so how do you guys think about it?

Jeff Bornstein

As it relates to our business?

Scott Davis - Barclays Capital

Yes, specifically to your business.

Jeff Bornstein

There is no question that reimbursement is a point on medical for everybody this is no question about that. The offset you are going to put more throughput, demand for -- prohibiting equipment is going to go up. I generally think that’s probably right, we’ll have to see how that plays out. I come back again on you got to have leading technology and leading cost positions to make this work. And I think more and more, we’re playing much broader in hospital systems around the total productivity equation into institutions. They are under enormous pressure in this new healthcare world that we’re living in to improve operations to get real productivity, real cost, et cetera. And to healthcare IT and a lot of our other offerings we have a lot to offer beyond MRI machines that can help in a hospital or hospital system with getting cost out and becoming more efficient. That obviously informs at some level and decision around equipment as well, but that’s really where we’re focused.

We need more broader way to value to our medical healthcare customers in the U.S. as a result of Obamacare and that’s exactly where we’re focused.

Scott Davis - Barclays Capital

Okay. And just to go around the world a little bit, let's talk about aerospace and aftermarket specifically. Can you give us a sense -- we have seen signs of life in aftermarket. Can you give us a sense of your 2014 outlook and whether there is some sustainable trends here that of improvement?

Jeff Bornstein

I mean utilization in aviation business is been outstanding revenue miles continue to grow, between 3% and 5% globally, obviously emerging in developing markets growing at drastic course of development. Even developed markets of increased revenue passenger miles, all of that is good and all means we’re consuming engines in the process. And that gives us, generates service opportunity. So commercially we expect another strong year in services for our aviation business. No question on the military front, that’s going to be more of a challenge, utilization in the military fleet is down pretty substantially, as a result of wind down of operations in Iraq and Afghanistan.

And so we expect our services business within the military segment to be down in 2014 versus 2013. We have accounted for that; we’ll overall still get growth in aviation on the strength in the commercial sector.

Scott Davis - Barclays Capital

Now, military has never been more than 20% of the total mix. It is probably even down from that now, right?

Jeff Bornstein

Yeah military will be down year-over-year and commercial will be up. So, you’ll have both dynamics work. So as a percentage of the total will be that much smaller. But you know the business got a ton of momentum. We just got back from a -- we just had the Dubai Airshow. All these technology investments we’ve made a new engine platforms over the last 10 or 12 years, some of those decisions taken right during post the 9/11 crisis, middle of SARS, global recession where we’ve got a lot of feedback on why we’re making those big investments. We took $40 billion of commitments in the Dubai Airshow on these new engine platforms, new airplanes, second place was 5 billion, third place was zero.

So I think we’ve really like where we’re positioned here for the long time because I think as many of you know if you miss an airplane, you miss an engine platform, you’ve missed it for 25 to 30 years. And most of the profitability in this space is about services and the aftermarket. So I mean I think we feel very good about how our aviation business has performed and how it’s positioned.

Scott Davis - Barclays Capital

Aerospace team tells us that the team that the engine provider who wins the number one spot gets 80% of the economics through the life versus the number two guys, it’s a winner take all, much more so than people probably even think. Let’s flip to one of your problem children and that’s energy management and I know it’s not a huge business. But the troubled stuff always sticks out a bit and I mean is there any hope and when I say is there any hope I understand that your competitors have higher margins. But it’s been several quarters in a row where we haven’t seen that much improvement really and is there hope that we could see a step change result here where we could get back up to a double digit margin level without too much pain between now and then in restructuring?

Jeff Bornstein

Yes, there is no question. We’ve had our challenges in energy management but you get very different stories going on simultaneously there. So, I talked earlier about industrial solutions. They actually had a pretty good year last year. Fourth quarter earnings were up 70%, they were up 30% for the year, they’re continuing a major restructuring, remaking that footprint, huge factory footprint that needs to be simplified.

Our grid business, digital energy business has been challenged and our meters has been pretty soft and there were some stimulus impact on a bubble on some of what they enjoyed a year earlier but we’ve got work to do there as well. And then really our power conversion business is where the bulk of the work is. And the good news is this business grew its backlog substantially last year, power conversion’s backlog was up 20%. They drew a highest amount of orders as a business that we’ve had in the fourth quarter of last year.

So it hasn’t been a winning in the market, it’s been an execution issue out of the factory. And part of that is we’ve built a pretty substantial Marine business in power conversion, and those first projects are really coming out now. Our success and win rate for instance in Brazil has been off the chart since we put that vertical together, we put that capability here from a product perspective. Simultaneously, with that you’ve had an integration going on amongst multiple acquisitions and within Converteam itself it was made up of simple acquisitions.

So we’ve had layers of integration going on. Now what I will say for ’14 is our expectations for that business are substantially improved from what we saw operationally in 2013. And we went through just yesterday, Chuck and I went through a very detailed plan with the team on exactly how we’re executing on each front, what our production plans were, scheduling plans, our backlog, cost, et cetera. And we expect to have from a profitability perspective to have a very big 2014 with market improvement. It’ll accelerate over the year and we’re making big restructuring investments there as well that we expect reasonably short paybacks on. So our expectations for business referred to be much better in ’14 than the performance we got in ’13.

Scott Davis - Barclays Capital

What influence do you think you can have on the M&A process? And I brought this up in the past in front of your colleagues and sometimes look at me like I am from Mars. But there is some head scratchers in the past of GE M&A and I think Lineage is a classic example. I was working on the IPO and when GE came in and bought it I could not for the life of me understand why GE would want to buy this business. I didn't want to IPO it, let alone. And I would have been IPO-ed at a much, much lower price than what you guys paid.

So when I think about the process and the accountability and predictability and consistency and so investors don't wake up one day and they see another Lineage and say, why would any -- why did GE want to be in data centers and sell into the telecom industry and all these other areas? Like what influence can you have on that process or maybe you don't have to have an influence as much as tell us how it’s changed or improved that should give investors more confidence that the process at least is tighter.

Jeff Bornstein

Well, I think that we largely have a new leadership team in Fairfield. Keith’s gone on to run GE Capital and I’m obviously new in the role, our M&A leader is new, HR leader is new, our CIO is new. So, there has been a lot of changes happening. I think we put more disciplined in the process, I’m not commenting specifically on Lineage. We rethought some of our metrics in terms of how we evaluate deals and how we think about hurdles and what make sense. At the end of the day, we have I think a pretty disciplined process with the businesses and then depending on the size it ultimately is a discussion of the board is to whether we ought to invest or not invest. And we have a very open discussion about whether each of us thinks it make sense, if the price is right, et cetera, et cetera, and then we ultimately make a recommendation to the Board and the Board has a decision around it.

I don’t know that it works materially different at other companies, I think that’s. On the accountability side, I think that through our quarterly blueprint process we’re asking -- the business is and now going through each of these deals that we’ve done and most recently we did a Life Sciences transaction in the Camry reciprocating engine deal. And they will give quarterly updates on where we are versus pro forma on revenue synergies, cost synergies, are we delivering not delivering, what are the integration issues et cetera, et cetera. So, they’ll be applying our framework around are we delivering against the economic that we’ve priced at when we agreed to do the deal.

Scott Davis - Barclays Capital

That is a good answer. So we’re going to go a little over time just because we started late. But let’s talk about China. And I first visited GE in China, I don't know, at least 10 years ago and maybe little bit longer. And I remember at that time the message was 10 billion in revenues by 2010 and now of course that was with the plastics business, so it is not completely apples-to-apples. But now I am guessing you’re somewhere around what 7 billion and change or so in China in 2013. What is the -- would have been the business model changes in China and what gives you confidence that we can get to that $10 billion revenue rate and do it at a margin that’s acceptable?

Jeff Bornstein

Listen, I think it’s -- I don’t think it’s complicated all. I think it’s a function of couple of things. One is being local in China. So, you led with Healthcare. Our Healthcare business is wholly owned run by our Chinese leadership team. We’ve developed products in China for China. Our sales force and distribution network is run and managed by us in China. So in most cases and businesses that we operate in China, we’re Chinese where it makes sense we do have some JV relationships where we think there is some value add there. And we have very good relationships at senior levels governmentally and corporate China that are well established and are critically important to our being a success there.

And then I think ultimately dramatically we’re right over the target on where the Chinese government is investing. The move from coal to gas it’s going to be enormous over the next 10 or 15 years. They’re putting more investments into getting natural resources out of the ground, oil and gas right over the target, huge focus on healthcare and improving the healthcare regime in China particularly moving from east to west. We’re right over the sea. So, I just think we infrastructure is still a substantial focus in China and where they’re making their infrastructure investment is where we play ball. And we have a good local team that can have execute on the ground. And as you know, we’ve been growing double digits in China on an orders basis for quite a period of time. And we expect, in ’14, we’ll grow double digits on an orders basis. We may not repeat all the aviation orders that we enjoyed last year in China, but that’s now we will --the balance of the businesses.

And then and I close with that on the aviation. I mean we have really run the table in China technology wise and done very good with the Chinese carriers there over time. So I think we’re in the right businesses with the right team on the ground and right relationships in country and where we operate as Chinese company in China.

Scott Davis - Barclays Capital

Right. Good. So let’s -- I want to see if there is a question in the audience and then I have a final question. So I will finish off then. So I have a personal view that GE is a global infrastructure company could have a tremendous future if current trends continue and that these projects get bigger and they become more sovereign, they become more complicated, and you have to have balance sheet in all that. And that there will be a time in our future where if you are doing a project in North Africa or something, it’s got to be a GE or it’s got to be a Siemens or a Mitsubishi, it’s got to be a Caterpillar. And all these smaller kind of marginal players just can’t compete for numerous reasons and some of it is political in connections and some of it is -- I mean the Algeria deal I thought that you did was brilliant.

I think for those of you who don't know the Algeria deal there was a fairly large sale there with some local jobs created which makes the local politicians look good, which helps the local economy. And of course it’s probably going to help GE win additional business. So I have that view, but to get there if you are GE, you probably need to have more scale in some of the businesses than you have. You probably need to be bigger in oil and gas you probably need to be bigger in mining. And then there are some businesses that don't really fit that theme. So how do you guys think about I mean A am I romancing this global infrastructure advantages thing too much and that’s not how you think about the business? Or if that is also how you think about the trends going down the road, how does that impact your decision making?

Jeff Bornstein

So, I completely agree with most of your thesis. I think that the world, more and more particularly in the infrastructure space, is heading towards a systems solution not skews, right. So customers, whether it Chevron or you know, pick a space, take a big player and use or sovereign, national oil company, for example, substantially, more everyday want systems solutions. They don’t want to have to fit and put together themselves in older skews from people.

So that changes dramatically the scope of what it means to in Algerian electrification project. The content, the scale, the technology is at a much higher level than it is calling up and ordering a gas turbine on the catalogue. And the whole world is moving in that direction and part of it is in emerging and developing markets. You don’t necessarily have all the local capability to do that locally, they need packaged solutions. They need the scale that comes with package solutions and they need the timetable and the speed with which packaged solutions can get executed to order to deliver.

And I think more and more that is going to be critical to -- and the difference between winning and losing, going forward with that and it’s true of every one of our businesses with maybe the exception of appliances and lighting, the balance of our businesses that’s going to be the expectation going forward. And what people want to buy is value and you got to be improving their view of their own CapEx and OpEx if you want to win and that can only be done through systems solutions. So we absolutely believe that and we think our systems capability is enormous and we’ll continue to evolve that over time.

I think the other thing I’d lay on top of that, like the China discussion, is thematically when you think about where the world is going I think we’re in most of the right places. I mean I think oil and gas, getting resources, kind of getting the marginal gas or barrel oil out of the ground is going to continue as a theme going forward. The transformation from coal to gas over time I think is unstoppable globally and we’re right over that theme, as you get these burgeoning populations and emerging developing markets moving up the economic food chain, growing middle classes, they fly more they consume more, they expect electrification, they expect quality healthcare and that’s what you see in a lot of these markets going on. And I think thematically we’re right over the target in every one of those.

Scott Davis - Barclays Capital

Okay. I think that’s a great place to stop. So, thank you, Jeff. Good luck to you with the GE team. And thanks everybody for being here.

Jeff Bornstein

Thank you.

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